20,000 U.s. Cars Could Be Trojan Horse Of Trade Battle

January 10, 1992|By DENIS HORGAN; Courant Columnist

Surely it was only the pesky flu that kept President Bush from realizing his every hope from his trip to Japan. But the visit was truly a great success -- and only those small-minded carpers obsessed with reality will say otherwise.

Not me.

Oh, I did have other hopes -- that the president could talk the Japanese into buying a fleet of Seawolf submarines as cargo vessels, which at $2 billion a poorly welded pop, would help erase the woeful trade deficit. But his clever automobile ploy will ultimately accomplish the same purpose.

There are those fastidious nitpickers -- most notably the U.S. automakers in the president's tow -- who say that a loose pledge to buy 20,000 American cars isn't going to dent the fact that we now are buying 1.75 million Japanese autos a year. But possibly they haven't studied the fine print, where the camel's nose intrudes.

People misunderstand history and precedent. When Bush wanted to destroy Saddam Hussein and bring freedom and democracy to Kuwait, he did not snap his presidential fingers to accomplish it overnight. Of course not; he launched a careful buildup of military and diplomatic efforts until Desert Shield became Desert Storm. The mini car pact is obviously only a first step in a familiar pattern -- hopefully with better results.

Parts and coverage. Remember those words. You read them here first.

The Japanese agreed to buy $19 billion in U.S. auto parts. They think they are buying them to build into their own vehicles. They haven't had much experience with American cars. I'd say $19 billion in parts -- repair parts -- for 20,000 cars sounds about right.

The Japanese will soon enough discover what Americans discovered so long ago: It costs more to have a U.S. car than to get one. Spoiled silly by their own cars which tend to run and run at low cost, they will experience the great joys of cars that break down, that do not do what they are supposed to do, whose glitches are never resolved in the first costly attempt at de-glitching but take six repair jobs -- more if the mechanic is looking to pay for a wing on his estate or take an intercontinental vacation.

Of course, the Japanese, a proud people, will not stoop to

untraining their own fine mechanics so frivolously used to doing the job right, so they will be required to import people especially skilled in dealing with American machines. And, true to the system, these workers will require executives -- each earning more than an emperor -- to devise the paperwork and the grand strategies that have made the industry what it is today. There's billions in it.

Billions, but only peanuts compared with what will follow when the auto insurance world gets involved. They'll need the Seawolves to ship the money.

The American car presence in Japan today is so pitifully small that it surely has escaped the shark-nose attention of our auto insurance world. No more. The addition of even only 20,000 cars will undoubtedly set off the alert bells in halls of the American yakuza -- the auto insurance empire. There's money out there.

Goodbye, Japan.

Mere presidents and moguls have to negotiate things. The car insurers, used to more power than that, used to pushing aside cringing regulators, will find a way to overwhelm the Japanese marketplace. That society, so based in respect for institutions, personal savings and almost unnatural orderliness will not survive as a great power. Its regimented workforce will see its legendery discipline unravel as workers are driven to distraction -- and poverty -- by auto insurance practices.

They will find their savings sapped dry by extortionate premiums. They will be driven wild-eyed by arbitrary rules and midstream changes in the rules. They will be bent low by trying to deal with an industry which considers mere clients as insects and lower than dirt, ground to powder in the face of arrogance and disdain for their trifling role of paying and paying and paying. They will pour all their money into sky-high fees which will go up and up for no knowable reason; if they wonder why, their policies will be canceled; if they have a 1,000-yen accident, they will endure 10,000-yen increases unto the third generation; if they vaguely resemble someone even in a different township who once filed a claim, their rates will be hiked higher.